ABC, a three-man equal partnership, owned the following assets on December 31: Basis FMV Cash $30,000 $30,000 Accounts receivable 30,000 30,000 Inventory 30,000 50,000 Land 15,000 30,000 ABC wishes to distribute land with a basis of $5,000 (FMV $10,000) to Judy, $10,000 cash to Bert, and Jack wants specific inventory items with a basis of $6,000 and a FMV of $10,000. ABC plans to sell another item of inventory with a basis of $4,000 and a FMV of $15,000 in the near future. The partners ask your advice on whether they should give Jack the inventory now or await the pending sale before making his distribution. Discuss.

Answer rating: 100% (QA)

The partners should give Jack the inventory now The partners should give Jack ... View the full answer